Canacol Energy (CNE): Ready to exploit Colombian tightening gas market
As we look across the E&P investment universe, few companies potentially offer greater asymmetric risk/reward upside compared with Canacol.
- As we look across the E&P investment universe, few companies potentially offer greater asymmetric risk/reward upside compared with Canacol.
- The company is playing into a tightening Colombian gas market, which should continue to support favourable pricing and longer-term growth plans.
- Our base case valuation stands at C$5.87/share and assumes the world will return to normal in 2022, with gas sales resuming to pre-COVID-19 levels.
- With fixed gas prices for the medium term and 624bcf 2P reserves, the downside exposure to this valuation is limited to exploration success and decreased gas demand.